Exchange with Commissioner Mandelson in the European Parliament on Fair Trade

Speech delivered on Thu 26th Oct 2006

Sarah Ludford Question: In your response to the European Parliament's report on Fair Trade and Development in July, you stressed that the EU needed a coherent and collective policy framework on Fair Trade and undertook to look at how the Commission could support the various certification and assurance schemes and help consumers obtain accurate and transparent information. What further conclusions have you drawn on an EU policy in support of Fair Trade?

In particular, while Fair Trade distribution and labelling schemes are well developed for food and drink products, this is not the case for garments. It is claimed, for instance, that Bangladeshi women can work 80-hour weeks in textile factories for just 10 euros a month, producing clothes to be sold cheaply on EU high streets. How will the Commission work with NGOs to assist the development of international Fair Trade standards and certification for the production of garments?

Peter Mandelson, Trade Commissioner Answer: Fair Trade has made enormous progress in getting labelled products onto supermarket shelves and into mainstream buying habits and practices. The same cannot yet be claimed for crafts and garments. The Commission will consider, as part of the follow-up to Parliament's report, whether there is scope for action in this area.

When I said in Parliament in July that 'what is required to tackle poverty and to enhance development is a fair and coherent policy framework', this was not limited to Fair Trade - though I acknowledged the helpful role that the report on Fair Trade and development would play. So whilst the Commission is considering how to capitalise further on the role of the Fair Trade movement, there are a number of other wider actions that it can undertake.

In cooperation with developing countries, we can promote decent work and international labour standards, as well as the interaction between decent work and other policies. The new thematic programme on investing in people, which comprises awareness-raising, training, information-sharing and the development of a set of indicators to monitor progress, will be an important tool.

The close link between decent work and poverty reduction is increasingly well understood in the EU. In the 'European Consensus on Development' - a document published in 2005 - employment and social cohesion are recognised as one of the nine areas of Community action. Employment, decent work and social cohesion are also central in the EU-Africa strategy.

In May 2006, the Commission adopted a communication on decent work for all, which will be presented at the Commission Conference on Decent Work and Globalisation in December, where the issues will be tackled in a comprehensive framework.

We are also contributing to the adoption of international norms and standards for all products, including textiles, through ongoing trade-related activities at bilateral and regional level. One example is a quality support programme in Bangladesh, which focuses on the improvement of the quality standards, metrology and accreditation systems in the country to help national laboratories ensure regional and multilateral recognition and acceptability of the conformity assessment certificates. The Bangladesh Standards and Testing Institute will also be strengthened in its basic capacity as a standards-setting body and in the area of metrology.

The programme will help to enable Bangladesh to address multilateral requirements, as well as to increase the competitiveness of its export industry. The project aims to create public-private partnerships and promote in particular awareness of quality and environmental managements systems and social standards - ISO 14000 and SA 8000 certified companies have increased in number - as well as strengthening the Consumer Association, through which pressure for change and control will be built up.

Sarah Ludford (ALDE). - Thank you for that answer, Commissioner. I entirely accept that there are wider issues in trade and development than Fair Trade alone. However, I should still like to hear from the Commission that you will give specific support to developing clear criteria for assessing Fair Trade assurance schemes. I should also like you to reflect on ways to boost transparency in pricing, so that consumers can see if the Fair Trade premium is passed back by supermarkets, as well as seeing that if they buy their ten-pound or fifteen-euro dress, their bargain may be at the expense of a decent living for textile workers.

Peter Mandelson, Member of the Commission: I sympathise with what the honourable Member is suggesting. I think that consumer information, consumer power in this context, is indeed the key. Fair Trade relies on consumers who have heard about the difficulties faced by poor producers and want to do something about it. We can help mainly by helping consumers to be clear about what is on offer, but we are looking for opportunities to support the Fair Trade movement when it comes up with targeted requests. I look forward to considering those as we reflect on what further action to take to support the Fair Trade movement in the weeks and months ahead.